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Joseph M. Ghabour & Associates LLC

How Should I Shop for Insurance? Is there a "right" way and a "wrong" way?

To my way of thinking, there’s a right way and a wrong way to buy insurance. The wrong way, unfortunately, is the approach we are most accustomed to taking when comparison-shopping: we figure out what we’re looking for, and then we look for it at the lowest price. Based on the assumption that the product is essentially the same regardless of where one buys it, this focus on price makes a great deal of sense. The problem is that insurance is different than most of the things we buy.

Insurance, first of all, is not a thing—it’s a contract that we purchase. Simply looking for a certain policy limit of the lowest price means we’re ignoring what’s actually in the contract. Our assumption tends to be that if we buy a car insurance policy, it will cover us in the event of an accident. But if matters were that simple, insurance contracts would be far shorter than they actually are. Most policies include lists of limitations and exclusions, which create holes in the coverage. And if an insurance company offers a policy that is far cheaper than those of its competitors, there’s probably a reason: more holes. Of course, that doesn’t mean that there aren’t good deals out there. It simply means that seeking the best value requires that we balance both the prices and the specific terms of the policies that we consider. More often than not, you get what you pay for. 

Joseph M. Ghabour
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Auto, Bus, Pedestrian, Motorcycle accident, medical malpractice and worker's compensation attorney.

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